NVIDIA’s NVLink Fusion Ups the Ante for AI Infrastructure

Key Points

• NVIDIA made several market-moving announcements at the Computex 2025 conference, including the launch of NVLink Fusion.
• NVLink Fusion allows for semi-custom AI infrastructure using 3rd-party CPUs and ASICs.
• Analysts are lifting their revenue and earnings estimates ahead of the Q1 release; NVIDIA will likely report strong and provide robust guidance.

NVIDIA’s NASDAQ: NVDA CEO, Jensen Huang, made numerous announcements at the Computex 2025 conference that amount to one thing: NVIDIA remains at the center of all things AI. While competitors advance their technologies, they remain steps behind and may never catch up due to this critical factor: NVIDIA launched NVLink Fusion.

NVIDIA NVLink is the technology linking NVIDIA GPUs and CPUs into functional supercomputers. It is the framework upon which most AI data centers are built and is now open to third-party manufacturers. 

Until now, NVIDIA GPUs were linked using NVIDIA’s NVLink and NVIDIA CPUs. Now, NVIDIA GPUs can be linked with third-party CPUs and ASICs, increasing the options for building semi-custom AI infrastructure and opening new revenue streams for NVIDIA.

The system works with an NVIDIA chiplet that can be integrated into any ASIC or CPU. The initial announcement included commitments from numerous semiconductor manufacturers already planning to use the technology, and more, eventually all, are expected to join the network over time. 

Other critical announcements at the Computex 2025 conference include updates to existing technology, upcoming product launches, and services for AI developers. The crucial product update is the RTX Pro Server, which is now in volume production. It increases performance roughly 2x to 4x, depending on the AI model, compared to the original H100 AI GPU.

Other updates include the expected launch of GB300 systems later this year, an advancement of the Grace Blackwell product line, and DGX Cloud Lepton, an SaaS service linking AI developers with crucial cloud resources and computing power. 

NVIDIA Analysts Raise Revenue Estimates Ahead of Q1 Release

NVIDIA will report strong results for Q1 2025 and provide robust guidance for the year. The Computex 2025 announcements reaffirm the existing outlook and provide additional revenue streams, including a new project with Foxconn. Foxconn, a supplier to Apple, will build an advanced AI supercomputer in Taiwan using 10,000 of NVIDIA’s GPUs.

The project will provide computing power for Taiwanese businesses, including Taiwan Semiconductor. 

The takeaway for investors is that analysts expect to see NVIDIA provide solid results and guidance and lift their targets ahead of the release. MarketBeat's consensus in late May is up nearly 500 basis points month-to-month, forecasting more than 65% growth on the top line. 

The analysts’ trends in April and May included sufficient price target reductions to land the stock on MarketBeat’s Most Dowgraded Stocks list, but investors need to look past that label. The consensus remains bullish, rated firmly at a Moderate Buy with coverage increasing and sentiment firming, and the price target assumes that more than 20% upside is still available.

The Computex announcements are a catalyst, likely to lead the analysts to revert to price target increases and spur the rally back into action. As it is, the $165 price target is sufficient for a new all-time high likely reached in tandem or shortly after the Q1 earnings report. 

NVIDIA’s Industry-Leading Position in AI Is Assured for Another Few Years

The net result of NVIDIA's May 2025 news, including the deals in Saudi Arabia, is that its position as the AI industry leader is assured for another few years, highlighting the deep value opportunity that is still available. The stock trades at only 31x its current year earnings compared to over 45x in recent years, and only 20x compared to the 2030 forecast and 12x relative to 20235, suggesting significant gains lie ahead.

Assuming the company only performs as expected over the next decade, it could rise by another 100% to 200% to trade in the range of 24x to 36x its 2035 forecast. 

The technical action in May is bullish. Although macroeconomic headwinds remain and market action is volatile, the rebound is strong and on track to retest all-time highs soon. A move to new highs would be significant, indicating a shift in market dynamics from wait-and-see into rally mode, and bring targets near $160 into play.